Though Bajaj Auto’s second quarter volumes remained flat, improved rupee returns on exports have contributed to the motorcycle major posting a net profit of ₹933 crore for the quarter ended September 30, 2015, against ₹591 crore for the same quarter of last year, translating into a rise of 57.8 per cent year-on-year.
The EBITDA margin has seen a growth from 20.8 per cent in Q2 2015 to 22.1 per cent in Q2 2016.
In some measure, the high growth (in percentage terms) of profits during Q2 2016 is also because the one-time pay out of ₹340 crore on account of the National Calamity Contingent Duty (NCCD) at its Pantnagar plant had dented Bajaj Auto’s Q2 2015 net profit.
This is the second highest net profit in the company’s history, surpassed only by that in the first quarter of the current fiscal, Bajaj Auto said in a filing to the BSE.
However, the company’s net income from operations grew a little over two per cent at ₹6,098 crore in the quarter under review against ₹5,963 crore in Q2 FY-15.
On the sales front too, volumes remained flat at 10.56 lakh units against 10.55 lakh units in Q2 2015. However, exports by value grew by 4 per cent to ₹2,836 crore. International business recorded its highest ever exports of over 520,000 units in Q2 FY-16. The average realisation was ₹65.2/$ in Q2 FY16 against ₹61.5/$ in Q2 FY15.
Bharat Gianani, Senior Research Analyst (Automobile), Angel Broking, said: “Net profit at ₹933 crore beat our estimates of ₹919 crore. Bajaj managed to improve the margins despite the volume pressures (volumes were flat yoy) and high competition in the industry.
“The operating margins at 21.6 per cent improved steeply 270 basis points y-o-y coming 50 basis points ahead of our assumptions. Soft commodity prices coupled with much higher dollar realisation on exports along with the robust operating metrics, higher other income (other income grew 34 per cent Y-o-Y) further boosted profitability.”
He added, “We currently have Neutral rating on the stock but would review our estimates post interaction with the management.”